Stakeholders of companies involved in potential mergers and acquisitions are getting out their protest signs. Andrea Brewer of Norton Rose Fulbright says that so-called M&A activists “who do not like the merits of a transaction that is being proposed are increasingly actively and publicly campaigning against the deal,” as well as sharing their own strategic alternatives with the shareholders.

Here are her tips for companies preparing deals that could draw the attention of activists:

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  • Strategy: “Having a well-defined strategic plan that is shared publicly is critical to stakeholders understanding how a proposed deal will fit in with the company's overall strategy,” says Brewer. Shareholders are proposing M&A opportunities to boards directly these days, so she suggests having already considered what's out there before this happens.
  • Engagement: Communication is key when it comes to getting stakeholders on board with a proposed deal. She says public companies must be aware of the risks of selective disclosure and suggests using a communications firm to publicly release key corporate messages, as well as share industry news, articles and investor presentations.
  • Monitoring: It's imperative that companies have a handle on how key stakeholders might react to a deal, even before it's announced. Brewer suggests working with advisers such as legal counsel to monitor public filings for changes in the shareholder base, which could signal potential activism in response to a proposed deal.